ABSTRACT
This chapter interprets the changing structure of China's new retail economy. Since the new retail economy has many facets, the chapter focuses on the aspects that best reflect the extent of the retail transformation: ownership change, retail format diversification, and the emergence of retail chains. The growth of department stores was fueled by ineffective government planning. Regionalism, which was often reinforced by local governments, frequently required the protection of local retailers, even within a city. This tendency made interregional expansion of chains and market penetration extremely difficult. Even the most successful chains, including Shanghai's Hualian, were mainly regional players. In a country as vast as China, where population distribution is uneven and economic disparities are rampant, geographical variations in retailing are not only anticipated but are also a reality. As in many post-industrial Western societies, retailing in China now plays a prominent role in job creation and regional economic development.
